Let me tell you a story of one of my first clients. As a newbie, and even now, I don't think I could have stopped it since I was being lied to, but I wish I had known because I would have stopped what was happening in its tracks, and told my clients not to buy, they were not ready.
Two days ago I found out these clients were about to lose their home to foreclosure coming up this Friday. They just want to let it go and don't want any help saving it. They just were ready to move on. What happened? They were doing so good, plenty of money, and this was their dream home.
Well here is the history of what had occurred before we found the home. In the pre-interview everything looked good, they were ready to buy a home, we just needed to find their home. They had good income (or so I thought), they had a pre-approval letter, and we were ready to go!
What had happened was one of them had less than perfect credit and the other was an independent contractor, but based on his pay they could afford the home and she didn't even have to be on the loan. Fine, great, let's find you a home! The only problem was the mortgage broker told them to lie. He based it on both their incomes and told them to lie about their income. Since he was an independent contractor, they could easily show her income combined with his. He told them to do this and NOT TO TELL the Realtors or you will not get the house. (WHAT?) You told them to commit fraud, just so they could get a house?
Well that decision, and their pride of not wanting to call me and try to find a way out, has cost them their home. They were embarrassed that they let themselves fall into the trap of committing fraud to get the home in the first place. You see as the market started to turn, his income as an independent contractor went down and because of that, they started to find themselves in trouble.
Was their anything I could have done? It's doubtful, as they wouldn't have told me their true situation with their money, because they were friends and really wanted a home. Was the mortgage broker going to tell me the truth? Well no, he had already proven that by telling them to lie to me if I asked any questions.
I've since tried to find the mortgage broker that wrote the loan for them, but his company seems to be out of business and nobody I know seems to know of him. So at this point I have to assume he is out of the business. (THANK GOD!)
The lesson here for you, the consumer and future home owner, is if someone tells you to lie, then it is time to walk away and get a second opinion. You are being asked to commit mortgage fraud and you can go to jail for it!
Comments (18)Subscribe to CommentsComment